Cayman's economy grew 2.4% in Q1

05 September 2016

Led by construction, real estate and financial services, Cayman’s economy grew in the first quarter of this year, according to a report released recently by the government Economics and Statistics Office.

Gross domestic product, the primary measure of economic expansion, grew 2.4 percent in the first quarter of 2016, according to the ESO report. Government economists project GDP will increase by 2.1 percent in 2016.

Finance Minister Marco Archer said in a statement, “The domestic economy continued to strengthen as GDP growth accelerated from the 1.4% recorded in the first quarter of 2015. Overall, the recent performance means that we are on track in achieving the 2.1% forecast GDP growth for the year.”

Tourism

Air arrivals in the first quarter fell by 2.5 percent, compared to the first quarter of 2015, according to the Department of Tourism.

The ESO writes in the new report, “As supported by the first quarter economic performance, the macroeconomic outlook for the calendar year 2016 remains upbeat with further upward growth potential if a new hotel project currently in progress will increase stay-over tourists during the last quarter of 2016.”

Referring to the new Kimpton Seafire resort on Seven Mile Beach, the ESO is looking to the added rooms for high-end stay-over tourists to help boost tourism numbers.

Air arrivals from the United States rose by half a percent, but arrivals from other markets, including Europe and Canada, dropped.

Visitors from the U.S. accounted for almost 80 percent of air arrivals, according to Department of Tourism figures.

The ESO notes that cruise arrivals continued to increase, up 12.5 percent in the first quarter compared to the same period in 2015.

During the first quarter of this year, 224 cruise ships arrived in Cayman, up from 209 for the same period last year.

Construction and real estate

The construction industry grew by 6.3 percent in the first quarter of the year.

The ESO’s quarterly report states, “Demand for construction services is expected to be sustained by on-going projects such as the expansion of the Esterley Tibbetts Highway and the Owen Roberts International Airport and the completion of private sector development projects.”

The value of property transfers increased significantly in the first quarter compared to Q1 2015, to more than $305 million from less than $150 million. The ESO writes, “This was due to the completion of sales and lease extensions of several multi-million dollar properties along the Seven Mile Beach.”